A predictable answer to the wrong question…

By
Blog Admin June 16, 2008

There’s bee some buzz about the new analysis by the Legislative Analyst’s Office (LAO) of the SB840(Kuehl), the universal, single-payer health care bill, and the companion financing bill, SB1014(Kuehl). SB840 has passed the Senate and is in Assembly Appropriations; SB1014, which contains the financing which requires a two-thirds vote, has stayed in the Senate.

The Sacramento Bee’s Dan Weintraub describes the LAO’s findings that SB840 and proposed financing would be a “financial train wreck,” while Senator Sheila Kuehl disputes that conclusion, but finds affirmation that “a single payer health care system saves money and lowers the rate at which health care costs grow each year.”

I haven’t had the chance to see the LAO analysis yet, so I can’t comment on the specifics. But I predicted a problematic report earlier this year in a blog post. The biggest problem is that it doesn’t compare the risks of health reform with the risks of remaining with the status quo (not just risks–the certain problems with letting the health system unravel). The issues raised by the LAO does mean there is more work to do on the financing and policy elements of SB840, but it doesn’t undermine the central argument for single-payer reform, that it provides the tools for covering more people and finding savings in the health system.

Why the report predictable? The LAO analysis of AB x1 1 earlier this year (detailed in this Health Access report here) would hinder any health reform, including single-payer. In fact, it says so, with a similar line at the bottom of the LAO single-payer report: “Any plan to reform the state’s health care system, by the nature of its complexity, will involve financial risk over the long term. Many of the fiscal risks discussed in this letter would be shared by a variety of health reform plans.”

The LAO report would be less of a problem, frankly, if some single-payer supporters who were opposed to AB x1 1 didn’t embrace the LAO analysis so vigorously earlier this year. But there were many SB840 supporters, including Health Access California, who also supported AB x1 1, and who saw and made the case that the LAO’s January analysis was being inappropriately used to hinder not just AB x1 1 (a good but imperfect bill) but anything else as well.

There is a crucial role for such financial analysis (both AB x1 1 and SB840 had significant independent modeling and analysis), but the questions should include a comparison with the status quo, and how a proposal can be modified to be fixed. The LAO is basically quantifying a projection of rising health costs: an unknown figure that admittedly is likely to rise. It is also focused on the impact on the state, rather than all Californians, who will bear these costs in one way or another. And it’s not like health care costs are going to stay the same if there is no reform.

There is an urgency to health reform. The delay is passing either SB840 or AB x1 1 or any other reform means it just gets harder to do the reform later, for every year the cost of health coverage goes up. That’s why we need action ASAP, now and in the future.

We’ll have more on the LAO analysis. There’s lessons to learn here, from the politics and the policy…